Enrolled Version - Final Version
House Bill 4582 History
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ENROLLED
H. B. 4582
(By Delegates Campbell, Guthrie, Hatfield,
Phillips, M. Poling, Kominar, White,
Craig, Marshall, Spencer and Mahan)
[Passed March 13, 2010; in effect from passage.]
AN ACT to repeal §5A-3-14, §5A-3-21, §5A-3-22, §5A-3-23, §5A-3-24,
§5A-3-25, §5A-3-26, §5A-3-37a, §5A-3-38, §5A-3-39, §5A-3-40,
§5A-3-41, §5A-3-42, §5A-3-54, §5A-3-55 and §5A-3-55a of the
Code of West Virginia, 1931, as amended; and to amend and
reenact §5A-3-1, §5A-3-2, §5A-3-3, §5A-3-4, §5A-3-12, §5A-3-
18, §5A-3-36 and §5A-3-37 of said code; and to amend said code
by adding thereto a new section, designated §5A-3-59, relating
to the functions of the purchasing director; procurement
process; exempting certain entities from the Division of
Purchasing; clarifying that the judicial branch is exempt from
the Division of Purchasing; documentation of inventory;
transportation of surplus property; providing resident vendor
preference to certified small, women and minority-owned
businesses; providing definitions; and providing rule-making
authority.
Be it enacted by the Legislature of West Virginia:
That §5A-3-14, §5A-3-21, §5A-3-22, §5A-3-23, §5A-3-24, §5A-3-
25, §5A-3-26, §5A-3-37a, §5A-3-38, §5A-3-39, §5A-3-40, §5A-3-41,
§5A-3-42, §5A-3-54, §5A-3-55 and §5A-3-55a of the Code of West
Virginia, 1931, as amended, be repealed; that §5A-3-1, §5A-3-2,
§5A-3-3, §5A-3-4, §5A-3-12, §5A-3-18, §5A-3-36 and §5A-3-37 of said
code be amended and reenacted; and that said code be amended by
adding thereto a new section, designated §5A-3-59, all to read as
follows:
ARTICLE 3. PURCHASING DIVISION.
§5A-3-1. Division created; purpose; director; applicability of
article; continuation.
(a) The Purchasing Division within the Department of
Administration is continued for the purpose of establishing
centralized offices to provide purchasing, and travel services to
the various state agencies.
(b) The director of the Purchasing Division shall, at the time
of appointment:
(1) Be a graduate of an accredited college or university; and
(2) Have spent a minimum of ten of the fifteen years
immediately preceding his or her appointment employed in an
executive capacity in purchasing for any unit of government or for
any business, commercial or industrial enterprise.
(c) The provisions of this article apply to all of the
spending units of state government, except as otherwise provided by this article or by law.
(d) The provisions of this article do not apply to the
judicial branch, the legislative branch, to purchases of stock made
by the Alcohol Beverage Control Commissioner, and to purchases of
textbooks for the State Board of Education.
§5A-3-2. Books and records of director.
The director shall keep accurate books, accounts and records
of all transactions of his or her division, and such books,
accounts and records shall be public records, and shall at all
proper times be available for inspection by any taxpayer of the
state.
§5A-3-3. Powers and duties of director of purchasing.
The director, under the direction and supervision of the
secretary, shall be the executive officer of the Purchasing
Division and shall have the power and duty to:
(1) Direct the activities and employees of the Purchasing
Division;
(2) Ensure that the purchase of or contract for commodities
shall be based, whenever possible, on competitive bid;
(3) Purchasing or contract for, in the name of the state, the
commodities and printing required by the spending units of the
state government;
(4) Apply and enforce standard specifications established in
accordance with section five of this article as hereinafter provided;
(5) Transfer to or between spending units or sell commodities
that are surplus, obsolete or unused as hereinafter provided;
(6) Have charge of central storerooms for the supply of
spending units, as the director deems advisable;
(7) Establish and maintain a laboratory for the testing of
commodities and make use of existing facilities in state
institutions for that purpose as hereinafter provided, as the
director deems advisable;
(8) Suspend the right and privilege of a vendor to bid on
state purchases when the director has evidence that such vendor has
violated any of the provisions of the purchasing law or the rules
and regulations of the director;
(9) Examine the provisions and terms of every contract entered
into for and on behalf of the State of West Virginia that impose
any obligation upon the state to pay any sums of money for
commodities or services and approve each such contract as to such
provisions and terms; and the duty of examination and approval
herein set forth does not supersede the responsibility and duty of
the Attorney General to approve such contracts as to form:
Provided, That the provisions of this subdivision do not apply in
any respect whatever to construction or repair contracts entered
into by the Division of Highways of the Department of
Transportation: Provided, however, That the provisions of this subdivision do not apply in any respect whatever to contracts
entered into by the University of West Virginia Board of Trustees
or by the Board of Directors of the State College System, except to
the extent that such boards request the facilities and services of
the director under the provisions of this subdivision; and
(10) Assure that the specifications and commodity descriptions
in all "requests for quotations" are prepared so as to permit all
potential suppliers-vendors who can meet the requirements of the
state an opportunity to bid and to assure that the specifications
and descriptions do not favor a particular brand or vendor. If the
director determines that any such specifications or descriptions as
written favor a particular brand or vendor or if it is decided,
either before or after the bids are opened, that a commodity having
different specifications or quality or in different quantity can be
bought, the director may rewrite the "requests for quotations" and
the matter shall be rebid.
§5A-3-4. Rules of director.
(a) The director shall propose rules for legislative approval
in accordance with the provisions of article three, chapter twenty-
nine-a of this code to:
(1) Authorize a spending unit to purchase specified
commodities directly and prescribe the manner in which such
purchases shall be made;
(2) Authorize, in writing, a spending unit to purchase commodities in the open market for immediate delivery in
emergencies, defines emergencies and prescribe the manner in which
such purchases shall be made and reported to the director;
(3) Prescribe the manner in which commodities shall be
purchased, delivered, stored and distributed;
(4) Prescribe the time for making requisitions and estimates
of commodities, the future period which they are to cover, the form
in which they shall be submitted and the manner of their
authentication;
(5) Prescribe the manner of inspecting all deliveries of
commodities, and making chemical and physical tests of samples
submitted with bids and samples of deliveries to determine
compliance with specifications;
(6) Prescribe the amount and type of deposit or bond to be
submitted with a bid or contract and the amount of deposit or bond
to be given for the faithful performance of a contract;
(7) Prescribe a system whereby the director shall be required,
upon the payment by a vendor of an annual fee established by the
director, to give notice to such vendor of all bid solicitations
for commodities of the type with respect to which such vendor
specified notice was to be given, but no such fee shall exceed the
cost of giving the notice to such vendor, nor shall such fee exceed
the sum of $125 per fiscal year nor shall such fee be charged to
persons seeking only reimbursement from a spending unit;
(8) Prescribe that each state contract entered into by the
Purchasing Division shall contain provisions for liquidated
damages, remedies or provisions for the determination of the amount
or amounts which the vendor shall owe as damages, in the event of
default under such contract by such vendor, as determined by the
director;
(9) Prescribe contract management procedures for all state
contracts except government construction contracts including, but
not limited to, those set forth in article twenty-two, chapter five
of this code;
(10) Prescribe procedures by which oversight is provided to
actively monitor spending unit purchases, including, but not
limited to, all technology and software commodities and contractual
services exceeding $1 million, approval of change orders and final
acceptance by the spending units;
(11) Prescribe that each state contract entered into by the
Purchasing Division contain provisions for the cancellation of the
contract upon thirty days' notice to the vendor;
(12) Prescribe procedures for selling surplus commodities to
the highest bidder by means of an Internet auction site;
(13) Provide such other matters as may be necessary to give
effect to the foregoing rules and the provisions of this article;
and
(14) Prescribe procedures for encumbering purchase orders to ensure that the proper account may be encumbered before sending
purchase orders to vendors.
(b) The director shall propose rules for legislative approval
in accordance with the provisions of article three, chapter twenty-
nine-a of this code to prescribe qualifications to be met by any
person who is to be employed in the Purchasing Division as a state
buyer. The rules must provide that a person may not be employed as
a state buyer unless he or she at the time of employment either is:
(1) A graduate of an accredited college or university; or
(2) Has at least four years' experience in purchasing for any
unit of government or for any business, commercial or industrial
enterprise.
Persons serving as state buyers are subject to the provisions
of article six, chapter twenty-nine of this code.
§5A-3-12. Prequalification disclosure and payment of annual fee by
vendors required; form and contents; register of
vendors; false certificates; penalties.
(a) The director may not accept any bid received from any
vendor unless the vendor has paid the annual fee specified in
section four of this article and has filed with the director a
certificate of the vendor or the certificate of a member of the
vendor's firm or, if the vendor is a corporation, the certificate
of an officer, director or managing agent of the corporation,
disclosing the following information:
(1) If the vendor is an individual, his or her name and city
and state of residence and business address, and, if he or she has
associates or partners sharing in his business, their names and
city and state of residence and business addresses;
(2) If the vendor is a firm, the name and city and state of
residence and business address of each member, partner or associate
of the firm;
(3) If the vendor is a corporation created under the laws of
this state or authorized to do business in this state, the name and
business address of the corporation; the names and city and state
of residence and business addresses of the president, vice
president, secretary, treasurer and general manager, if any, of the
corporation; and the names and city and state of residence and
business addresses of each stockholder of the corporation owning or
holding at least ten percent of the capital stock thereof;
(4) A statement of whether the vendor is acting as agent for
some other individual, firm or corporation, and if so, a statement
of the principal authorizing the representation shall be attached
to the certificate or whether the vendor is doing business as
another entity;
(5) The vendor's latest Dun & Bradstreet number and rating, if
there is any rating as to the vendor;
(6) A list of one or more banking institutions, if such
institution is available, to serve as references for the vendor; and
(7) The vendor's tax identification number.
(b) Whenever a change occurs in the information submitted as
required, the change shall be reported immediately in the same
manner as required in the original disclosure certificate.
(c) The certificate and information received by the director
shall be public record.
(d) The director may waive the above requirements in the case
of any corporation listed on any nationally recognized stock
exchange and in the case of any vendor who or which is the sole
source for the commodity in question.
(e) Any person who submits a false certificate or who
knowingly files or causes to be filed with the director, a
certificate containing a false statement of a material fact or
omitting any material fact, is guilty of a misdemeanor and, upon
conviction, shall be fined not more than $1,000, and, in the
discretion of the court, confined in jail not more than one year.
An individual convicted of a misdemeanor under this subsection may
never hold an office of honor, trust or profit in this state, or
serve as a juror.
§5A-3-18. Substituting for commodity bearing particular trade name
or brand.
If a spending unit requests the purchase of a commodity
bearing a particular trade name or brand, the director may substitute a commodity bearing a different trade name or brand, if
the substituted commodity reasonably conforms to the adopted
standard specifications and can be obtained at an equal or lower
price.
§5A-3-36. Inventory of removable property.
The director has the power and duty to make and keep current
an inventory of all removable property belonging to the state.
Such inventory shall be kept on file in the office of the director
as a public record. The inventory shall disclose the name and
address of the vendor, the date of purchase, the price paid for the
property therein described and the disposition thereof.
§5A-3-37. Preference for resident vendors; preference for vendors
employing state residents; preference for veteran
residents; exceptions.
(a) Effective beginning July 1, 1992, in any instance that a
purchase of commodities or printing by the director or by a state
department is required under the provisions of this article to be
made upon competitive bids, the successful bid shall be determined
as provided in this section. The Secretary of the Department of
Revenue shall promulgate any rules necessary to: (i) Determine
that vendors have met the residence requirements described in this
section; (ii) establish the procedure for vendors to certify the
residency requirements at the time of submitting their bids; (iii)
establish a procedure to audit bids which make a claim for preference permitted by this section and to reject noncomplying
bids; and (iv) otherwise accomplish the objectives of this section.
In prescribing the rules, the secretary shall use a strict
construction of the residence requirements set forth in this
section. For purposes of this section, a successful bid shall be
determined and accepted as follows:
(1) From an individual resident vendor who has resided in West
Virginia continuously for the four years immediately preceding the
date on which the bid is submitted or from a partnership,
association, corporation resident vendor, or from a corporation
nonresident vendor which has an affiliate or subsidiary which
employs a minimum of one hundred state residents and which has
maintained its headquarters or principal place of business within
West Virginia continuously for four years immediately preceding the
date on which the bid is submitted, if the vendor's bid does not
exceed the lowest qualified bid from a nonresident vendor by more
than two and one-half percent of the latter bid, and if the vendor
has made written claim for the preference at the time the bid was
submitted: Provided, That for purposes of this subdivision, any
partnership, association or corporation resident vendor of this
state, which does not meet the requirements of this subdivision
solely because of the continuous four-year residence requirement,
shall be considered to meet the requirement if at least eighty
percent of the ownership interest of the resident vendor is held by another individual, partnership, association or corporation
resident vendor who otherwise meets the requirements of this
subdivision, including the continuous four-year residency
requirement: Provided, however, That the Secretary of the
Department of Revenue shall promulgate rules relating to
attribution of ownership among several resident vendors for
purposes of determining the eighty percent ownership requirement;
or
(2) From a resident vendor, if, for purposes of producing or
distributing the commodities or completing the project which is the
subject of the vendor's bid and continuously over the entire term
of the project, on average at least seventy-five percent of the
vendor's employees are residents of West Virginia who have resided
in the state continuously for the two immediately preceding years,
and the vendor's bid does not exceed the lowest qualified bid from
a nonresident vendor by more than two and one-half percent of the
latter bid, and if the vendor has certified the residency
requirements of this subdivision and made written claim for the
preference, at the time the bid was submitted; or
(3) From a nonresident vendor, which employs a minimum of one
hundred state residents or a nonresident vendor which has an
affiliate or subsidiary which maintains its headquarters or
principal place of business within West Virginia and which employs
a minimum of one hundred state residents, if, for purposes of producing or distributing the commodities or completing the project
which is the subject of the vendor's bid and continuously over the
entire term of the project, on average at least seventy-five
percent of the vendor's employees or the vendor's affiliate's or
subsidiary's employees are residents of West Virginia who have
resided in the state continuously for the two immediately preceding
years and the vendor's bid does not exceed the lowest qualified bid
from a nonresident vendor by more than two and one-half percent of
the latter bid, and if the vendor has certified the residency
requirements of this subdivision and made written claim for the
preference, at the time the bid was submitted; or
(4) From a vendor who meets either the requirements of both
subdivisions (1) and (2) of this subsection or subdivisions (1) and
(3) of this subsection, if the bid does not exceed the lowest
qualified bid from a nonresident vendor by more than five percent
of the latter bid, and if the vendor has certified the residency
requirements above and made written claim for the preference at the
time the bid was submitted; or
(5) From an individual resident vendor who is a veteran of the
United States Armed Forces, the Reserves or the National Guard and
has resided in West Virginia continuously for the four years
immediately preceding the date on which the bid is submitted, if
the vendor's bid does not exceed the lowest qualified bid from a
nonresident vendor by more than three and one-half percent of the latter bid, and if the vendor has made written claim for the
preference at the time the bid was submitted; or
(6) From a resident vendor who is a veteran of the United
States Armed Forces, the Reserves or the National Guard, if, for
purposes of producing or distributing the commodities or completing
the project which is the subject of the vendor's bid and
continuously over the entire term of the project, on average at
least seventy-five percent of the vendor's employees are residents
of West Virginia who have resided in the state continuously for the
two immediately preceding years and the vendor's bid does not
exceed the lowest qualified bid from a nonresident vendor by more
than three and one-half percent of the latter bid, and if the
vendor has certified the residency requirements of this subdivision
and made written claim for the preference, at the time the bid was
submitted; or
(7) Notwithstanding any provisions of subdivisions (1), (2),
(3), (4), (5) or (6) of this subsection to the contrary, if any
nonresident vendor that is bidding on the purchase of commodities
or printing by the director or by a state department is also
certified as a small, women or minority-owned business pursuant to
section fifty-nine of this article, the nonresident vendor shall be
provided the same preference made available to any resident vendor
under the provisions of this subsection.
(b) If the Secretary of the Department of Revenue determines under any audit procedure that a vendor who received a preference
under this section fails to continue to meet the requirements for
the preference at any time during the term of the project for which
the preference was received the secretary may: (1) Reject the
vendor's bid; or (2) assess a penalty against the vendor of not
more than five percent of the vendor's bid on the project.
(c) Political subdivisions of the state including county
boards of education may grant the same preferences to any vendor of
this state who has made a written claim for the preference at the
time a bid is submitted, but for the purposes of this subsection,
in determining the lowest bid, any political subdivision shall
exclude from the bid the amount of business occupation taxes which
must be paid by a resident vendor to any municipality within the
county comprising or located within the political subdivision as a
result of being awarded the contract which is the object of the
bid; in the case of a bid received by a municipality, the
municipality shall exclude only the business and occupation taxes
as will be paid to the municipality: Provided, That prior to
soliciting any competitive bids, any political subdivision may, by
majority vote of all its members in a public meeting where all the
votes are recorded, elect not to exclude from the bid the amount of
business and occupation taxes as provided in this subsection.
(d) If any of the requirements or provisions set forth in this
section jeopardize the receipt of federal funds, then the requirement or provisions are void and of no force and effect for
that specific project.
(e) If any provision or clause of this section or application
thereof to any person or circumstance is held invalid, the
invalidity shall not affect other provisions or applications of
this section which can be given effect without the invalid
provision or application, and to this end the provisions of this
section are severable.
(f) This section may be cited as the "Jobs for West Virginians
Act of 1990."
§5A-3-59. Small, women and minority-owned businesses.
(a) As used in this section:
(1) "Minority individual" means an individual who is a citizen
of the United States or a noncitizen who is in full compliance with
United States immigration law and who satisfies one or more of the
following definitions:
(A) "African American" means a person having origins in any of
the original peoples of Africa and who is regarded as such by the
community of which this person claims to be a part.
(B) "Asian American" means a person having origins in any of
the original peoples of the Far East, Southeast Asia, the Indian
subcontinent or the Pacific Islands, including, but not limited to,
Japan, China, Vietnam, Samoa, Laos, Cambodia, Taiwan, Northern
Mariana, the Philippines, a U.S. territory of the Pacific, India, Pakistan, Bangladesh, or Sri Lanka and who is regarded as such by
the community of which this person claims to be a part.
(C) "Hispanic American" means a person having origins in any
of the Spanish-speaking peoples of Mexico, South or Central
America, or the Caribbean Islands or other Spanish or Portuguese
cultures and who is regarded as such by the community of which this
person claims to be a part.
(D) "Native American" means a person having origins in any of
the original peoples of North America and who is regarded as such
by the community of which this person claims to be a part or who is
recognized by a tribal organization.
(2) "Minority-owned business" means a business concern that is
at least fifty-one percent owned by one or more minority
individuals or in the case of a corporation, partnership, or
limited liability company or other entity, at least fifty-one
percent of the equity ownership interest in the corporation,
partnership, or limited liability company or other entity is owned
by one or more minority individuals and both the management and
daily business operations are controlled by one or more minority
individuals.
(3) "Small business" means a business, independently owned or
operated by one or more persons who are citizens of the United
States or noncitizens who are in full compliance with United States
immigration law, which, together with affiliates, has two hundred fifty or fewer employees, or average annual gross receipts of $10
million or less averaged over the previous three years.
(4) "State agency" means any authority, board, department,
instrumentality, institution, agency, or other unit of state
government. "State agency" does not include any county, city or
town.
(5) "Women-owned business" means a business concern that is at
least fifty-one percent owned by one or more women who are citizens
of the United States or noncitizens who are in full compliance with
United States immigration law, or in the case of a corporation,
partnership or limited liability company or other entity, at least
fifty-one percent of the equity ownership interest is owned by one
or more women who are citizens of the United States or noncitizens
who are in full compliance with United States immigration law, and
both the management and daily business operations are controlled by
one or more women who are citizens of the United States or
noncitizens who are in full compliance with United States
immigration law.
(b) State agencies shall submit annual progress reports on
small, women and minority-owned business procurement to the
Department of Administration in a form specified by the Department
of Administration.
(c) The Department of Administration shall propose rules, for
legislative approval pursuant to article three, chapter twenty-nine-a, to implement certification programs for small, women and
minority-owned businesses. These certification programs shall deny
certification to vendors from states that deny like certifications
to West Virginia-based small, women or minority-owned businesses or
that provide a preference for small, women or minority-owned
businesses based in that state that is not available to West
Virginia-based businesses. The rules shall:
(1) Establish minimum requirements for certification of small,
women and minority-owned businesses;
(2) Provide a process for evaluating existing local, state,
private sector and federal certification programs that meet the
minimum requirements; and
(3) Mandate certification, without any additional paperwork or
fee, of any prospective state vendor that has obtained
certification under any certification program that is determined to
meet the minimum requirements established in the regulations.